You could argue Davison Mudzingwa and Francis Hweshe picked the right business at the wrong time.
“Poor funding, falling numbers in theaters and improving technologies are some of the reasons affecting the film industry in Africa,” says Hweshe.
We share a pizza after the premiere of Lost Tongue, their documentary on a disappearing language of the Kalahari Desert, on a winter evening at The Bioscope, in the Maboneng Precinct, in Johannesburg.
Hweshe and Mudzingwa are all smiles as it sold out and attracted positive comments from the tough film crowd. But the joy of the night fades like the closing credits with thoughts of the rough, hard and unpredictable road ahead.
Their life story is woven into their Lost Tongue film. They too, as second-language English speakers from Zimbabwe, suffer lost language, lost identity, and lost money.
“Funding is difficult to come by and if you wait to get money, you will not make a film. Every filmmaker should be prepared to empty their own pocket,” adds Hweshe.
Mudzingwa, the director, says filmmaking is even riskier than fashion.
“You have to bet on your instincts that people will like it. Most African filmmakers put so much on the art of producing and forget the business element,” he says.
What makes the documentary industry even tougher is that in Africa, where often the best films are made, fewer and fewer are going to the cinema.
“We are making films with universal themes that someone in Afghanistan, Spain and United States can watch,” laments Hweshe.
On this night the documentary was about a subject closer to home.
Lost Tongue was one of the 10 documentaries from around the world screened at the Socially Relevant Film Festival in New York in March. It cost the filmmakers more than $250,000 over three years. They will never get their money back.
The film, a debut feature presented by South African-based Mvura Ya Afrika Productions, explores a story of hope and revival of the ancient and endangered N|uu language of the marginalized Khomani San people of the Kalahari.
“A cultural and spiritual journey reveals the battle through time in the language going extinct. Today, the fight continues with new conflicts against time, with the number of surviving people who can speak the language diminishing,” says Mudzingwa.
Steven Markovitz, film producer and distributer, agrees. He says money is as important as a camera in this business.
“Documentary film is a tough business. There is need to marry sustainability and passion, which is the great approach to this and every other sector.”
Markovitz, who has directed over 100 films in 14 years, says no matter what happens, he will never leave the trade and has handed it down to his 17-year-old son.
“Most people do film for money and not passion, each time you embark on a project you should finance it from scratch.”
He puts the case for more investment.
“The strength of the film industry covers a lot of disciplines and these may include carpentry, accounting, artistry and creative jobs. Film that travels and has impact in the world has a profound effect on the public,” says Markovitz.
Nigeria is an African country seeing a boom in the film industry. It is the third largest national film industry in the world, with estimated annual revenue of $590 million. According to the Nigeria Bureau of Statistics, the film industry’s share of Nigeria’s GDP is at 1.4%.
The problem is, just like Mudzingwa and Hweshe, Nigerian filmmakers are failing to sell beyond Africa. With piracy also taking its toll, fewer and fewer filmmakers are making money.
As long as there are stories to tell, Mudzingwa and Hweshe will keep telling them until their pockets are empty. While many keep complaining that African stories are the domain of outsiders, here are two young African filmmakers telling African stories.
By the end of this year, this African story of the Lost Tongue would have travelled to the United States, South Africa, Tanzania, Canada and Spain.  Lets’ hope it finds its tongue on the international stage.

Get Rich Or Try Dying – Sounds Like A Documentary?

His bow ties may be small but his dreams are big. Neither could have been born if it was not for the sight of his mother slaving over a hot stove.
On a balmy afternoon, we meet 21-year-old Emmanuel Mohlala, a bow tie designer, at his studio in downtown Johannesburg.
Mohlala is surrounded by a collection of his velvet and leather bow ties.
Entrepreneurship was always in his blood. He made his first buck selling fatcakes in high school to help his mother’s spaza shop. Selling fatcake after fatcake, he realized his love for the world of business.
Then he suffered the heartbreak of seeing his mother baking at 1AM.
“At the time, I felt so useless. But I always knew that I’d make her proud,” says Mohlala.
<img loading="lazy" decoding="async" class="alignleft size-medium wp-image-5150" src="/wp-content/uploads/2017/05/Emmanuel-017-200x300.jpg" alt="" width="200" height="300" />
In those lean times, his dreams kept him going.
He was born in the dry and dusty Ga- Mampuru village of South Africa’s Limpopo province and grew up in Vosloorus, east of Johannesburg. He is the fifth of six children.
After matriculating in 2013, Mohlala took a year off for soul searching.
“I needed to learn the ropes of business,” he says.
In May 2015, he teamed up with his eldest brother to start the Clanman brand.
“I started the business with an old tie I got from home; I had to use it to make a bow tie which I sold to get enough money to buy one meter of fabric,” says Mohlala.
“For me, they are exclusive. It’s something that should be worn on special occasions.”
Mohlala needed money to start his business. Unfortunately, no one was willing to invest.
“I was turned down at various shops around Joburg CBD for months.”
“My turnaround happened when I got a Theatre boutique at Eastgate Mall, that’s when I started to see a way forward in my business,” says Mohlala.
Though the business hasn’t made a lot of cash, Mohlala thinks it will grow into a profitable one.
Currently busy with a collection of bow ties, under his business, he has dressed South Africa’s Minister of Home Affairs, Malusi Gigaba, and celebrity Maps Maponyane.
Mohlala’s advise to his peers?
“Do thorough research. Know the pros and cons of the business you’re going into, so that you can tackle challenges when they surface.”
“When I started, I thought everyone would be supportive of my business.  Soon I learned, to succeed you have to sacrifice a lot, and that friendship and business don’t go hand in hand,” he says.
He hopes to have at least a collection of watches and sunglasses under his belt by 2020.
And he would like to design a bow tie for Nigerian entrepreneur and Africa’s richest man, Aliko Dangote. If he continues to dream big, he will.

The Entrepreneur With Success Tied Up

We are at Camp Kigali, the venue of the 2016 World Economic Forum (WEF) in Rwanda in May, and Akinwumi Adesina, President of the African Development Bank (AfDB), has just walked past the media center in a suit sporting a bright bowtie – he probably has the nattiest collection of bowties on the continent.
There are other men around him and in the background, wearing grey suits, coffee stains and lazy expressions. And Matthew Rugamba swaggers in, in a peacock blue suit and vest, making a sartorial statement louder than all their spiffy PowerPoint presentations.
The 26-year-old founder and creative director of House of Tayo is not at WEF to peddle his latest collection of Afrochic bowties and accessories that are currently wowing Rwanda. He’s here as part of a high-caliber panel, including former AfDB chief Donald Kaberuka, speaking about youth entrepreneurship and Africa Rising.
“Throughout the panel discussion, I had to keep pinching myself,” says Rugamba.
<img loading="lazy" decoding="async" class="alignleft size-medium wp-image-5146" src="/wp-content/uploads/2017/05/IMG_0189_tayo-200x300.jpg" alt="" width="200" height="300" />
“There was a time when people would laugh at me for saying I wanted to make bowties in Rwanda, and here I was on stage with some incredible people.”
Born in England to Rwandan and Ugandan parents, Rugamba lived and studied in Kenya, Swaziland and the United States (US), where he acquired a degree in international relations. In his final year, he walked up to his mentor and advisor and announced he wanted to pursue a career in fashion design.
“It’s funny how much my international relations background has impacted what I am doing now. My advisor said ‘do what you want to do’, and told me that through fashion and design, I would probably have a greater impact in the field of international relations than some of my peers who were going to grad school or doing a PhD,” says Rugamba.
Part of the reason for his fortitude was he wanted to be his own boss. After high school, when he was 17, his parents persuaded him to take up a summer job in the United Kingdom (UK). That’s when he sold toys and painting sets to kids at Hamleys and Harrods in London.
“I earned only commissions. I told myself I would never do a job like that in my life. It almost controlled you. Sometimes, going to work was more expensive than staying at home,” says Rugamba, also a diehard Manchester United fan, who confesses to taking time off work even now to watch a good match.
When the war was raging in Uganda, there were no opportunities for young people so Rugamba’s father had moved to the UK, juggling three jobs at the age of 23. His mother, Rosette Chantal-Rugamba, herself a trailblazer credited with changing the tourism landscape in a post-genocide Rwanda in the 2000s, is an entrepreneur in the conference tourism industry; she runs Songa Africa. She too had started her career at Harrods in the UK, when she first joined her husband in the eighties.
After college, Rugamba applied for a summer job in his mother’s company and worked on one of her tourism projects, using the $300 he earned to launch his bowtie brand.
“My parents said I had to prove myself. So I sold some sample bowties and scarves to two of my aunts and they loved it; they said whatever support I needed, they would help.”
<img loading="lazy" decoding="async" class="alignleft size-medium wp-image-5144" src="/wp-content/uploads/2017/05/IMG_2572_tayo-200x300.jpg" alt="" width="200" height="300" />
Thereafter, Rugamba returned to the US to complete his degree. That’s where he delved into the mind of the customer.
“In Washington DC, when you step into the metro, everyone is wearing standard red and blue ties. And here I was, wearing these loud bowties… When I said I was from Rwanda, there would always be immediate pity or if it wasn’t pity, it was condescending praise, such as ‘oh my God, your English is so good’. I hated the pity and thought ‘what can I do to change perceptions’, and saw power in bowties…  All the soft power I learned in class was now coming to the fore.”
Rugamba retuned to Rwanda in 2013 and now crafts his products in bold African colors and vibrant patterns at a workshop in Kigali, working with women’s cooperatives to make men’s accessories.
“The women are so dedicated and accommodating. I bought them an industrial sewing machine to show them that I wasn’t there to just make money, but also wanted a long-term working relationship with them,” says Rugamba.
His design aesthetic is local, but he is aiming for an international reach. There are many things he would like to first change in the local industry though.
“I have started to push for changes in the fashion industry as a whole. There is a huge gap for skills, raw materials and for my business to thrive, I need the industry to grow as a whole. I am also keen on 3D printing. This is also why I am here at WEF, to network,” says Rugamba, gesturing to the sprawling venue.
When you are successful, you attract others like you. And in Rwanda’s close-knit business circles, you make more friends than foes.
Ephraim Rwamwenge, the 23-year-old CEO of Rwa Business Group, also a WEF delegate, joins Rugamba with a hug and handshake for an impromptu photoshoot. The two had met professionally and then became mates. This is another entrepreneur worth his salt – or sugar. Also a regular emcee at high-profile corporate events and dinners, Rwamwenge had emceed the youth event at this edition of WEF, hosted by Rwanda’s First Lady Jeannette Kagame on day one of the business meet.
“I keep telling Matthew he should give me suits so when I go up and emcee, I can say I am wearing House of Tayo. Matthew is famous, his brand is so visual, unlike the rest of us, who sell sugar,” laughs Rwamwenge.
Born and raised in Botswana and of Ugandan-Rwandan parentage, Rwamwenge started his business at the age of 19. He is also a WEF Global Shaper.
He had returned to Rwanda in June 2012 with $1,000 borrowed from a family friend and business mentor.
“I had to pitch to him for support to raise capital. My parents were both teachers, and we were middle class. Then my dad became a full-time pastor and did missionary work. We had a decent childhood but not one of privilege. I had to work hard for everything I wanted,” says Rwamwenge.
In high school, if he wanted to buy PlayStations, he would make money selling lyrics.
“Back then, the girls and boys in school would listen to songs and write the lyrics. One of my uncles had an internet café, so I would google the songs, print the lyrics and sell them. A page would sell at 50 cents. Most songs would be two pages, and I would make sure the font was big, so I would make more money.”
<img loading="lazy" decoding="async" class="alignleft size-medium wp-image-5145" src="/wp-content/uploads/2017/05/IMG_8349-204x300.jpg" alt="" width="204" height="300" />
As an entrepreneur, Rwamwenge now packages, distributes and sells sugar from Kigali to Rwanda’s rural areas. Success has been sweet.
“People talk of low margins in commodities but there is a serious return on capital invested, especially if you can work on a good turnover. So we started the export of coffee. So to the people who were supplying us with sugar, we said you give us sugar, we will give you coffee, and offset the balances.”
Rwamwenge’s company turnover last year was about $1.3 million, and with his investors and partners, he is hoping to multiply and expand his businesses. Up next is a range of premium coffee.
Later that night – the last day of WEF – we meet Rugamba and Rwamwenge again, at Innovation Village, the hip art café and culture hub on the top floor of Kigali’s public library. Everything their generation loves is here: art, coffee, business – and bowties.

The Sweet and  Fashionable Life Of Being  Your Own Boss

It may have turned many a stomach, but it was all in a day’s work for a rookie profiler. Not many can say they have seen a woman smashed with a hammer, chopped with an axe, the blood drained, before being dumped along the Krugersdorp highway, near Johannesburg, in South Africa.
“This was my first crime scene. There were a lot of cars passing on the highway, a lot of policeman and crime scene photographers looking over the body. The scene wasn’t too bloody because most of the blood had been drained in the bath and because the body was kept there, it was preserved a bit,” recalls Gérard Labuschagne.
Labuschagne was 29 years old at the time and just weeks in the job.
“I felt like I was out of my league. I had to use my experience and what I had learned to help find him,” he says.
<img loading="lazy" decoding="async" class="alignleft size-medium wp-image-5139" src="/wp-content/uploads/2017/05/Gerard-113-200x300.jpg" alt="" width="200" height="300" />
And they did.
“When he was caught, at the trial, he said he would have done it again. He contacted and met with estate agents first, claiming he wanted to buy a home… This was the second interior decorator he had invited to his home. We often see this type of behavior in serial killers because they slowly move towards what they want to do by trial run. Contacting estate agents satisfied him for whatever need, perhaps to gain confidence to move forward to the next step,” says Labuschagne.
For 14 years, this was his life, catching killers and locking them up. He investigated over 110 serial killers, over 200 serial rapists, in thousands of cases, trained the Behavioural Analysis Unit of the FBI and became head of the South African Police Services’ (SAPS) specialized Investigative Psychology Section. One of his big cases – the Oscar Pistorius trial.
“I was called to the scene after it happened. Oscar had no right to shoot the gun. There are other things he could have done… After hearing all the evidence, I don’t know whether he intended to kill her specifically. There are things that point towards it but there are also things that point against it. Unfortunately, only he will know.”
Promotions in the job meant management roles which he isn’t passionate about.
“I like working on cases and being on the field. I felt that the organization can’t change because of me. I didn’t see myself doing that for another 17 years so I had to retire,” says Labuschagne.
For a year and a half, he worked towards what he thought was a breakthrough for business.
“I felt our work in the police was very reactive, someone would have been killed or someone would have been raped by the time we are called in. Even if you catch the guy, you can’t bring back the person that has been murdered. We could bring justice and maybe prevent the person from committing the same crimes again, because most of these guys repeat offend, but it’s not enough,” says Labuschagne.
While in the police he noticed more and more businesses were asking them to help assess threats. This was his chance. Labuschagne went into the world of entrepreneurship, founding L&amp;S Threat Management. His life took a turn.
L&amp;S Threat Management focuses on workplace violence, what Labuschagne calls a ticking time bomb.
“We live in a society characterized by violence and conflict. Many of our lives have been touched by threatening behavior and violent crime, and increasingly so in a work environment. We do training for, usually, security people to give them the skills to assess whatever potential threat they have and how to manage it to make sure that the threat isn’t carried out. We also train people on what work place violence is and what concerning things one needs to escalate, concerning warning signs, and consult on cases,” he says.
Their main focus is assessing and managing potential threats of violence in the workplace, including threats by outsiders towards employees, threats between employees, and anonymous threats towards employees because, according to Labuschagne, companies should protect its employees.
“We always think in lines of hard hats and not about safety in terms of violence towards or by your staff in the workplace. If it is part of your job to get threats, it is an onus on the employer to assess if you need a bodyguard or not, how many you need and when. But how does the employer do that if they don’t know how to do threat assessment,” he says.
Labuschagne knows it all inside out.
“I have had death threats which were not made directly to me but were made to third parties, which are actually more concerning. We always say if someone threatens you and says they are going to kill you and put the phone down, there is probably nothing much to worry about, if there are no other behaviors,  because if he is going to kill you, why is he going to tell you. But, in this instance, a guy killed his girlfriend and his father was telling people that he is going to kill me,” he says.
As good as an idea is, convincing companies to fork out money for these services is hard.
“The issue is convincing people to pay for something they have never paid for before. When we start explaining what we do and give an example, they understand there is a need for this service because in most cases they can relate.”
For the man who helped crack the Oscar Pistorius case, it’s all in a day’s work.

The man who helped crack  the Oscar Pistorius case

It was a usual Friday evening on July 1; I had just knocked off at work. Jersey City, in New York, was covered with American flags of all sizes, flying from car roofs, apartments and the front gardens of homes. Barely in sight in the morning, the red, white and blue flags suddenly mushroomed in my host city.
In the corridors of Forbes’ office, I overheard colleagues talking about their grand plans for the coming Independence Day long weekend – it meant nothing to me as a South African, I was just excited for the day off on Monday. I don’t hate my job, it’s just in a South African’s DNA to halt the capitalist machinery.
The South African public holiday on April 27, which marks the country’s first democratic elections in 1994, doesn’t have much significance to me nor my friends. We are happy to be duty free, unlike the careerist politicians who never miss the opportunity to sell empty dreams at rallies. While the voting fodder flocks into stadiums for a political party’s t-shirt or a small food pack, we catch up on household chores and a little fun later in the day. In the 22 years of this so-called freedom, I haven’t witnessed anything like the patriotism of the Americans.
Since 1776, without fail, over 300 million Americans still commemorate the Fourth of July, with pomp. On July 4, 1776, the Declaration of Independence was adopted, and the British Empire lost control of the 13 colonies that now make up part of the United States (US). Now, many countries were once colonized by the British Empire, but none come as close to celebrating their independence as the US. Sadly, independence didn’t apply to everyone; the US continued exploiting African slaves for a century. The country had now elevated itself to the colonizer until 1865, when slavery was abolished. Even this didn’t put an end to the lynching of African Americans. As a matter of fact, the brutality experienced by blacks is still pervasive today.
The longevity of the US independence can be attributed to John Adams, the lawyer and politician who would become president. While pleading with the larcenous British Empire, Adams penned a letter to his wife, Abigail, expressing his wish for independence.
“I am apt to believe that it will be celebrated, by succeeding generations, as the great anniversary festival. It ought to be commemorated, as the day of deliverance by solemn acts of devotion to God Almighty. It ought to be solemnized with pomp and parade, with shews, games, sports, guns, bells, bonfires and illuminations from one end of this continent to the other, from this time forward forever more,” wrote Adams.
To this day, his wish lives on, Americans commemorate the day with barbeques, parades, and fireworks.
As I drew near to my apartment on that hot Friday’s night, looking forward to sundowners at Guillo’s Place, the local Mexican bar, there was a strange activity in the yard. My neighbors were out on the stoep having drinks.
They warmly invited me to their small soiree, but the sudden friendliness took me by surprise. I waited for two months to be invited for tea, but I was always the invisible African. I went up to my studio to grab the dusty bottle of South African dry red that was on top of my fridge.
From then, the long weekend was taken care of, with copious food and drink consumed, like the millions of other Americans. As America is going to the polls later this year, it was inevitable that politics was discussed. Despite voting in the New Jersey primaries, none of my new acquaintances were happy with Hilary Clinton nor Donald Trump. Who cares? At least they know who they are voting for. I am envious of their freedom to choose who can stand for president. I don’t see that happening in my homeland.
The long weekend culminated to the mother of all parties at 9PM on Monday. Even the rain couldn’t put a damper on the revellers that had gathered on Coles Street, in downtown Jersey City, nor the fireworks on the other side of the Hudson River in Manhattan.
Thanks to my neighbors, I didn’t miss Guillo’s tequila.

The Night African Wine Trumped Tequila

Africa’s biggest platinum industry faces one of the most bruising years in its history. Unions and management have drawn battle lines for pay talks and a cloud of question marks hangs over the mining laws – dual uncertainty that could deter foreign investors from putting money in a country that produces 70% of the world’s platinum.
In July, pay talks for a new one-year deal began. Unions for 130,000 workers in South African platinum mines, sat down with the big three: AngloPlats, Implats and Lonmin. They are likely to prove tricky and drag on for weeks. The majority union, the Association of Mineworkers and Construction Union (Amcu), wants a 15% pay rise; the second largest, the National Union of Mineworkers (NUM), wants 20% across the board. Both unions are eyeing the recovering platinum price nosing above $1,000 an ounce for the first time in years. In August 2011, it was over $1,900.
<div id="attachment_5133" style="width: 210px" class="wp-caption alignleft"><img loading="lazy" decoding="async" aria-describedby="caption-attachment-5133" class="size-medium wp-image-5133" src="/wp-content/uploads/2017/05/Peter-Leon-017-200x300.jpg" alt="" width="200" height="300" />Peter Leon</div>
Demand for platinum, thanks to jewellery and automotive manufacturers, rose 10% in the first quarter of this year, according to the World Platinum Investment Council, while supply dropped 11%. It promises profit for South African mines if they can keep costs down; wages make up almost half of costs.
Amcu has 61% of the membership at AngloPlats, 62% at Implats and 82% at Lonmin. It holds the aces and will play a mean game for a minimum wage of R12,500 (around $860) a month. This wage has been the rallying call from Amcu ever since the bitter Marikana strike of August 2012. At the announcement of its demands in July, FORBES AFRICA questioned R12,500, saying it should be more like R20,000, taking into account four years of inflation.
“If we say R20,000 for the lowest paid, the employers are going to run away so we will go for R12,500 and work up from there,” says, the president of Amcu and part-time preacher, who appeared bullish and ready for action.
“We are applying for a pay rise here, not a strike. If the employers apply for a strike we will give it to them.”
The platinum employers are likely to be a tough nut to crack; inflation, at around 6%, is on their side. They are also struggling against years of falling commodity prices and productivity. On the Johannesburg Stock Exchange, AngloPlats shares lost two thirds of their value last year and Lonmin, kept afloat by a shareholders’ bailout in 2015, lost 99%.
Aside from the industrial problems, South Africa faces many more months of uncertainty over the country’s mining laws. Amendments to the Minerals and Petroleum Resources Development Act – which governs mining – have spent four years going back and forth through Parliament; questions have been raised over the constitutionality of the amendments. Investors take a dim view of plans to make resources – like iron and coal for the steel industry – designated minerals under the law. That would mean miners accepting government prices and maybe having to ask permission to export. This could lead to a trade law complaint at the World Trade Organization (WTO). China suffered a WTO ruling against it recently in a similar case concerning rare earth.
Then there are concerns about the discretion the law hands to the minister, giving him the power to cancel mining licences and prosecute.
“It is open to discretion, with unclear rules, which makes it very difficult to invest with that level of uncertainty and that is the long and short of it,” says Peter Leon, a mining lawyer with Herbert Smith Freehills, at a briefing in Johannesburg in June.
“We are going to a third rewrite without solving the problems of the first two.”
The bill is on its way back through the legislature and a number of bodies, including the Congress of Traditional Leaders of South Africa. Leon and his colleagues say the chiefs came up with one of the best ideas yet – an independent body to allocate the state-owned mineral rights.
With Parliament adjourned for the August 3 municipal elections, mining experts fear it could be well into next year before South Africa’s mining code is fixed. Investors seek stability and regulatory certainty; with every passing month there is a risk more of them will turn away.

Platinum Blues

The road to the mining misery, in Louieville, Mpumalanga, is a picture of poverty; roads are crumbling and children roam the streets barefoot.
It has been five months since the fatal accident at the Vantage Goldfields, Lily Mine, near Barberton, Mpumalanga, and three people are buried in the rubble.
Yvonne Mnisi, Pretty Nkambule and Solomon Nyarende were buried, 80 meters underground on February 5, in a steel container where a crown pillar collapsed at the open pit gold mine.
Everyday Nkambule’s husband, 39-year-old December Mazibuko, wakes up to what he calls another day in hell.
We meet Mazibuko at his house made of mud, in Louieville, 20 minutes away from Lily Mine. He is on his way to apply for a child support grant at the clinic for his 10-month-old baby. Mazibuko says he had his last meal two days ago. With an empty fridge and electricity on zero units, Mazibuko lives on handouts.
“It’s tough,” says Mazibuko.
“I haven’t eaten. I sometimes get help from my family and neighbors, if they don’t come, it gets hard. I don’t know what to do and where to go to. The shops don’t give us food anymore because they know we don’t get paid anymore,” says Mazibuko, who worked at Lily Mine for nine years.
About 600 workers have been left without jobs since the mine collapsed.
In March, Mineral Resources Minister, Mosebenzi Zwane, promised families of the trapped a R200,000 (around $13,800) compensation and workers who survived R50,000 (around $3,500) each. The workers claim they’ve seen nothing.
“We didn’t get any money. They’ve been promising to pay us the money, ‘til now we haven’t received it,” says Mazibuko.
“We are very hungry. From now until December, the situation is going to get worse. How are we going to send our children to school? Already most of them are no longer going to school. I just want the bosses to pay us, if they can’t, then they should tell us. This is unfair,” says a Lily Mine worker, who didn’t want to be named.
On the day of the tragedy, 115 people clocked in for work and nearly all were rescued. The three missing were working in a steel container, used as a lamp room, which crashed down a sinkhole.
Rob Devereux, a business rescue practitioner, says they needed to raise R200 million (around $13.8 million) to dig a declined shaft 500 meters away from the sinkhole.
“We are in the process of raising the money. We offered all workers voluntary severance packages. Once we receive the funding, we’ll settle the workers’ salaries and rehire them,” says Devereux.
He says it might take up to a year for the mine to reopen.
“It will take about eight months to develop the rescue operation and the mine will open three months after that.”
Joseph Montisetsi, Deputy President of the National Union of Mineworkers, says they are planning to march to the Department of Mineral Resources (DMR) in Johannesburg.
“We are calling on the DMR, as the regulator, that it must be in the forefront to make sure that the three employees trapped underground are rescued,” says Montisetsi.
The three missing workers were all breadwinners.
Dead or alive, the families say they want to find closure.
“We just want the mine to get Solomon out from the ground so that we as the Nyarendes can bury him,” says Wanda Nyarende, a cousin.
Through it all, Mazibuko hopes that his wife is still alive. Like most at this mine he feels abandoned.

A Despairing Demand From The Desperate

It’s bad news when a commercial bank collapses; it’s frightening when three of them go under within just eight months in a single market.
The back-to-back collapse of mid-tier Chase Bank, Imperial Bank and Dubai Bank sent chills across the Kenyan financial sector – eliciting a scramble for remedial measures, including consolidation and review of capitalization requirements for banks.
Chase Bank’s operations were taken over by the Central Bank of Kenya (CBK) in April after its management failed to declare KES8 million ($80,500) in insider loans, causing panic withdrawals and a run on the bank.
Imperial Bank was taken over in October after fraud was uncovered. Two months earlier, smaller lender, Dubai Bank, was put into receivership.
This state of affairs triggered anxiety on the health of the banking sector in Kenya even though regulators and the National Treasury have gone all-out to downplay the concerns, calling the bank closures “isolated cases”.
“I want to assure my fellow Kenyans that our financial sector remains strong and stable. The recent placing under receivership of three banks was due to specific factors related to these banks and not the whole banking sector,” says Finance Cabinet Secretary Henry Rotich, as he sought to calm nerves over the health of the East African nation’s financial sector.
But even with the assurance, Rotich and his team at the Treasury are not resting. They are planning a raft of strategies, including consolidation, in an attempt to clear weak lenders from the Kenya’s banking sector and help restore confidence through larger and better capitalized outfits.
Rotich plans to re-introduce higher capital levels for banks to guarantee their financial health.
“Last year, I did table in this house specific measures to increase the capitalization of banks in order to ensure we have a strong and stable banking system but our efforts were not successful,” Rotich told the Kenyan Parliament in June when he presented his budget speech.
In 2015, Kenya’s legislators shot down Rotich’s proposal to raise commercial banks’ minimum capital fivefold to KES5 billion ($50 million) within three years, after CBK Governor Patrick Njoroge said such a move would strangle smaller lenders.
Rotich, however, is keen to push through the higher capital requirements this time round and by extension trigger consolidation of weak lenders in an attempt to prevent further financial glitches among the 42 licensed commercial banks.
“I am seeking to introduce the proposals and I am hopeful that members will look at them more favorably in light of the recent developments in our banking industry,” says Rotich.
The impending changes in bank capitalization requirements have already triggered action among small lenders that are keen on complying.
Midsized lenders, presently feeling the pressure to consolidate to capitalize on economies of scale and remain relevant, have already taken to mergers or pacts with private equities to boost the asset position.
I&amp;M Holdings, which has stakes in banks in Kenya, Tanzania, Rwanda and Mauritius, is set to finalize a KES5 billion ($50 million) deal to merge Giro Commercial Bank with its subsidiary I&amp;M Bank.
“In our view, the acquisition will have minimal strategy disruption given similarities of the two banks – both have conservative balance sheets and mainly target middle- to high-income customers as well as SMEs (small and medium enterprises),” the listed lender said in a statement in June.
Small-sized Kenyan lender Oriental Commercial Bank formally rebranded to M-Oriental Bank in June following the acquisition of a 51% stake in the shareholding of Oriental by Bank M Tanzania.
The Kenyan banking industry has also witnessed several other acquisitions recently, including the 75% purchase of Spire Bank (formerly Equatorial Commercial Bank) by Mwalimu Sacco and Nigeria’s Guaranty Trust Bank acquiring Fina Bank.
In 2014, investment group Centum also completed the acquisition of K-Rep Bank (now Sidian Bank) in a deal that raised Centum’s shareholding from 7.54% to 67.54%, having been a minority shareholder in the bank since 2004.
Centum’s acquisition was effected through Bakko Holdco Ltd, a non-operating holding company, to conform to CBK guidelines.
Kenya’s largest bank by asset base, KCB Group, is also looking at medium-sized lenders to buy as part of an expansion plan and is building up capital to boost its acquisition war chest.
“We will look for businesses where there can be synergy, where there can be ability for us to scale up, so medium-sized banks will be areas that we are focusing on today,” KCB CEO Joshua Oigara told Reuters.
In May, KCB Group shareholders gave a nod to the lender’s plan to raise KES10 billion ($100 million) through a rights issue later this year to boost its capital levels. KCB’s total capital stood at KES79 billion ($795 million) at the end of 2015.
KCB Group is expected to acquire a majority stake in Chase Bank after it was recently appointed to manage the mid-tier bank that only re-opened after a brief closure due to liquidity problems following a run by panicked depositors.
The government is also considering merging National Bank of Kenya (NBK), Development Bank of Kenya and Consolidated Bank, which it owns, in a bid to take advantage of having a large lender.
“We are making progress on the issue of consolidation because we now have a consultant who will soon be advising us on how to move. We expect to consolidate the state banks into one or two banks very soon,” Rotich said in April.
The changes in bank capitalization have also seen an inflow of private equity to try and boost the books of Kenyan banks.
In March, Fidelity Commercial Bank announced British private equity and asset management firm Duet Group had acquired a significant stake in the small lender. In the deal, Fidelity Bank will receive KES1.9 billion ($19 million) from the sale and boost its capital position, which was narrowly above mandatory requirements following an increase in adequacy ratios in 2015.
Furthermore, Norway’s investment fund for developing countries, known as Norfund, in partnership with NorFinance, an investment firm created by Norfund and private investors, purchased a 12.22% stake in Kenya’s Equity Group Holdings for an estimated KES26 billion ($261 million) from private equity group Helios Investment Partners.

Hoping For More  To Bank On

Fifty five years on and the Democratic Republic of Congo (DRC) is still haunted by the violent death of Patrice Lumumba. The first elected leader of the country came to one of the saddest ends of any leader in Africa in a tortured nation that has found peace elusive. His death; the agony of being beaten and paraded before television cameras, before being dismembered to oblivion in the bush, mirrors the intense suffering of his country.
A pan-Africanist to the core, Lumumba’s dream was a united Africa. A move that smacked of the Soviets, according to jittery foreign affairs officials at the height of the Cold War, in Washington, Brussels and London.
“We have known the atrocious sufferings of those who were imprisoned for their political opinions or religious beliefs and of those exiled in their own country. Their fate was worse than death itself. Who will forget the rifle-fire from which so many of our brothers perished, or the gaols in to which were brutally thrown those who did not want to submit to a regime of justice, oppression and exploitation which were the means the colonialists employed to dominate us?” read part of Lumumba’s famous Independence Day speech that was to prove his death warrant by convincing people in power that he should be removed.
“Had he lived, much of the violence that we see on the continent could have been prevented; and could probably have ushered in greater economic success and stability as economic liberalists would argue. Lumumba was not alone in this thinking during this period. Others who were leading this African union were: Milton Obote from Uganda, Jomo Kenyatta from Kenya, Julius Nyerere from Tanzania and Kwame Nkrumah from Ghana,” says Wendy Isaacs-Martin, the Acting Head of the Archie Mafeje Research Institute at the University of South Africa.
His death is regarded by the Belgian author, Ludo De Witte, as the most important assassination of the 20th century. After his death, the DRC descended into division and war.
“I ask you all to sink your tribal quarrels: they weaken us and may cause us to be despised abroad,” Lumumba foretold in his inauguration speech.
Many accuse the American and Belgian governments for his death, but it is likely a lot more complex that. One factor is uranium from the country’s mines that was used to manufacture the first atomic weapons used on Hiroshima and Nagasaki. The US and certain European countries would not trust such strategic raw materials to someone who was leaning towards the Soviets.
Isaacs-Martin says Lumumba stands as the icon of the intellectual potential Africa possessed in post-independence years.
“Like many of his peers he represented an intellectual discourse that saw the need to create social cohesion within the continent and a national identity within their particular countries,” she says.
“He also represents something that is often forgotten in our current understanding of Africa during the Cold War. In the eventual legacy of failed and successful coups that has plagued Africa, Lumumba, in being deposed and then killed four months later, represented the epitome of Africa’s potential and how the continent was essentially robbed from establishing itself in a post-colonial and bi-polar period.”
Lumumba’s assassination was one of many: Amilcar Cabral (Guinea); Felix Moumie (Cameroon); Sylvanus Olympio (Togo).
“Their assassinations marked the beginning of demise in effective political leadership and eroded the potential foundations for African philosophical, sociological and political thought. Instead there has been a trend to support the coercive wing into political leadership that continues to prove ineffective but in the interests of existing (or potentially new) political elites and external stakeholders,” says Isaacs-Martin.
“The tensions between regional leaders that continue today represent an inability of Africans to see beyond their limited identities that have often been externally prescribed and exploited. Yet it was these very concerns that individuals such as Lumumba advocated against, focusing on advancing Africa beyond the limited thinking of resource extraction and authoritarian exploitative administrative systems.”
Lumumba’s body was never found; neither was another leader like him.

What could have been

Elections in Africa are not child’s play; if you run out of luck, you can pay with your life. This was true of Zambia’s Mapenzi Chibulu, an 18-year-old female opposition activist shot dead on the streets of Lusaka by police in political turmoil.
On July 9, in broad daylight, and a month before she was expected to join millions in voting for the next president, Chibulu lost her life. It forced the electoral body, the Electoral Commission of Zambia, to suspend campaigns for 10 days in Zambia’s capital.
As if the political turmoil was not enough, the copper producing country has done little to allay fears of investors, bearing hard currency, over a country that has struggled to diversify from mining.
The country, celebrating 52 years this year, is in turmoil as incumbent President Edgar Lungu, who has been in power for a year, is battling to stop opposition leader, Hichilema Hakainde, from wresting power. Lungu came in after President Michael Sata died in office. Hakainde is a businessman and a British-educated economist.
The two will face each other in a watershed election of August 11. Whatever the outcome, this election will be contested; whoever loses will claim electoral fraud after polls.
“For 50 years our nation has lived with peace, stability and freedom. There is no place for this type of violence in our society. I take a firm stance against any sort of violence in our democracy,” Lungu said in a statement.
To his opponents, his words ring hollow in the light of Chibulu’s death.
Political analysts say the electoral landscape, in the run up to the polls, has been punctuated by skirmishes between the ruling Patriotic Front and the opposition United Party for National Development.
“This comes as no surprise and we have been warning for months now that the political climate in Zambia was not conducive to free and fair elections and that the country risked losing its democratic reputation if authorities allowed this to continue,” says Gary van Staden, Senior Political Analyst at NKC African Economists.
“While the decision to suspend campaigning is a negative development, it at least provides some breathing space for authorities and political parties to put in place concrete measures to help take off the pressure that has been building over months now and threatens the credibility of the poll. The suspension of campaigning is the lesser of two evils but it remains an evil and any attempt to extend the suspensions will be unacceptable.”
While the election will pass, the challenges facing Zambia will not. Economists warn that politicians should not make it worse.
Herryman Moono, an economist from Economics Association of Zambia, says the unfolding political developments, marred by violence and government pressure on private media, has created political tension.
“The excessive use of force by the Zambia police, who are on record of cancelling opposition party rallies and recently the use of live ammunition leading to the killing of an opposition party supporter, while injuring others, is raising concerns about the security of the nation as we approach elections,” says Moono.
“These developments are creating anxiety among the local and international community. Should these continue, Zambia will slowly be perceived as a risky investment destination which has a strong and negative bearing on foreign direct investment in the short to medium term. An elevated risk profile arising from electoral violence can easily lead to subdued economic growth as investments – both local and international – dwindle.”
Moono adds that, beyond a damaged reputation and being a low grade investment destination, the Zambian currency would, in the midst of an electoral crisis, negatively affect the Zambian Kwacha which has been extremely volatile and poor-performing the past few years.
Thato Motaung, Associate Executive Director at the African Democratic Institute, says, to date, Zambia has experienced fairly peaceful and successful transitions of power; showing a promising trait of embracing the democratic will of the people.
“The key issues facing the build-up to Zambia’s election are mostly rooted in this insecurity. There is a large vocal citizenry, vigorous independent media, paired with a well-organized opposition; a combination that leaders often perceive as threatening. Hence we see the iron fist emerge in raids, police brutality and censorship in an attempt to pacify the perceived threat.”
On August 11, we will know who will take the reins.

The Price We Pay for democracy

Brexit was a sharp shock for the United Kingdom (UK) – Africa will feel its shockwaves in time.
According to Irmgard Erasmus, Senior Financial Economist, NKC African Economics, the biggest impact will be on forex and financial markets.
“This will primarily filter through to the real economy via the indirect impact of global risk sentiment on commodity prices, impacting the balance of payments and the monetary system, and implying that the upside risks to inflation have increased on account of exchange rate pass-through,” says Erasmus.
According to Erasmus, the African currencies most at risk from external headwinds are the Zambian kwacha, the Angolan kwanza, and the Ghanaian cedi.
<img loading="lazy" decoding="async" class="alignleft size-medium wp-image-5116" src="/wp-content/uploads/2017/05/Brexit-005-200x300.jpg" alt="" width="200" height="300" />
“In turn, the CFA franc zone, under the two common monetary unions (the Central African Economic and Monetary Community, CEMAC, and the West African Economic and Monetary Union, WAEMU) is implicitly vulnerable to EU developments via the impact on the euro exchange rate. CEMAC and WAEMU peg their currencies to the euro at the same rate.”
On the markets, Brexit has been felt with share prices falling and investors rushing into safe-haven assets.
According to Rian le Roux, Chief Economist at Old Mutual Investment Group, South Africa is likely to be caught in the crossfire.
“South Africa will not escape the market or economic fallout of Brexit, although the full impact will likely only become clear over time. While our financial markets will pretty much echo global markets in the short term, the medium-term impact on South Africa will be determined by the extent to which commodity prices, South Africa’s export volumes, and capital flows to South Africa, are affected,” he says.
According to Le Roux, South Africa’s already poor growth prospects will be further undermined.
As far as the direct impact of a likely recession in the UK will have on South Africa, Le Roux estimates it would be relatively small, as the UK buys only about 4% of South Africa’s exports.
“However, one area that might be negatively affected is tourism, as the UK is responsible for about 18 percent of tourist arrivals from outside Africa,” he says.
However, Old Mutual Balanced Fund portfolio manager, Graham Tucker, says they expect their clients’ portfolios to be somewhat protected.
“Within our asset allocation funds, we have been positioned lighter than usual in South African equity and listed property (collectively known as growth assets), holding significantly more cash than normal in this volatile environment,” says Tucker.
While Old Mutual has been defensively positioned, they have holdings in counters that are attractively priced and have good fundamentals, but are exposed to Brexit risk. Within the Old Mutual Balanced Fund, these include Old Mutual, Investec and, more recently, UK property company, Intu.
“We remain comfortable with these positions on a longer-term view, but there is clearly downside risk in the short term as investors grapple with the implications of the Brexit referendum outcome.”
This fund holds about 12% in South African government bonds.
“These offer an attractive real yield and in our view should provide good medium-term returns. However, they could be impacted by a selloff in emerging market assets and currencies. The initial reaction of the bond market has however been relatively muted,” says Tucker.
According to Neil Wilson, market analyst at ETX Capital, fears that Brexit would kill off deals in the UK seems to have been overblown.
“Britain is very much open for business and the weak pound is key. A lot more British firms could become foreign-owned quite soon,” says Wilson.
Steven Gamble, a banking and finance lawyer at Norton Rose Fulbright, says given its historical trade relations with Africa, he is worried about the European Union’s (EU) instability after Brexit.
“Britain is the fifth largest economy in the world. Africa is not going to be immune to this. The UK is South Africa’s fourth largest export destination so it is important. The UK is also the largest investor in the South African economy which makes it critical,” says Gamble.
According to Gamble, Ghana is looking at short-term upsides in terms of gold and Kenya is stable.
“Every year, $21 billion is remitted from the UK to Nigeria. I am interested as to why there is a lot of anxiety there because the fact that the UK has come out of the EU shouldn’t have a direct impact on remittances,” he says.
Maybe we should take Old Mutual’s advice and take Brexit as an opportunity to put cash to work and gain exposure to quality assets that are indiscriminately sold off in the panic.

Brexit Wrecks It

A few months ago, he was a lone voice in the wilderness, now he is an international figure. Days after his acquittal in court, he has a campaign manager and his personal assistant tells me that for now he is not taking any calls. I speak to him in Johannesburg days later.
“I have not spoken to my parents yet due to security concerns for them. But, I know they have been praying for me. My wife was there throughout the whole court proceedings from morning to evening, fully pregnant. She is an amazing woman, I tell you,” he tells me from Johannesburg, in a visit that might last longer than his supporters want.
Evan Mawarire shot to international recognition on July 12, the day he presented himself to the police with a bible in hand and his flag around his neck. The country’s police had summoned him over a missing police helmet, a baton and suspicion of possessing subversive material.
“As we entered the cold, dark and smelly cell popularly known as ‘Baghdad’, I couldn’t help notice the brotherliness amongst the group inmates. They laughed, hit high fives and exchanged stories on what had landed them in for the first time or yet again. Nearly all the young men in the cell with me that night told me truth of their offenses. The one guy said to me ‘I deserve this and my desire is to stop stealing but I can’t boss, I don’t have a job’. Later that evening we shared some of my food that had been brought to me and he took it upon himself to ask anyone in the cell who had more than two blankets to give me one. I’ll be honest I’ve made a lot of friends in my lifetime, but that day in that cell I made some truly special friends. I met some real genuine Zimbabwean men,” says Mawarire.
The man of the cloth, who now had a blanket, was to also face charges of trying to topple his government. It all ended in acquittal and cheers at the Rotten Row magistrate’s court in Harare.
He is not the first to face such charges: Morgan Tsvangirai, Dumiso Dabengwa, Lookout Masuku and Ndabaningi Sithole, all opposition politicians, have been similarly accused down the years.
Mawarire’s crime: filming himself, using his mobile phone, complaining about his country’s malaise. The government’s only evidence, as they dragged him to court, was his posts on Facebook, Twitter and YouTube. This is the story of Mawarire and his hashtag campaign #ThisFlag. In Zimbabwe, it’s risky to say the least.
Mawarire rallies hundreds of thousands of demonstrating ex-patriate Zimbabweans from Harare to London, Washington, Johannesburg and Melbourne. His words appear powerful enough to persuade citizens to shut down the country; on July 6, this turned Bulawayo and Harare into ghost towns.
On Sundays, he preaches to a congregation of 70, outside church, his sermons about politics, economy and corruption reach tens of thousands over the internet. His campaign is so powerful that the government is contemplating banning social media.
“This campaign is unique as it’s not led by politicians; it’s a campaign by ordinary citizens. We are calling for citizens to act now and act urgently, we are not going to be silenced and intimidated by the government. The call is for our government to account for and address corruption, injustice and poverty,” he says.
Mawarire, married with two children, grew up in Mazowe, 40 kilometers north of Harare, in a family of six. He studied at one of the country’s top schools, Prince Edward in Harare, before his father brought him back to the village. At 16, he was chosen as Zimbabwe’s first child president from the country’s schools.
Twenty three years later, Mawarire’s country is mired in poverty while the elite earn vast salaries; he claims billions have been lost to corruption. His campaign emerged out of frustration over scraping together school fees.
“We are completely unhappy with the situation, we have graduates who are vendors, our pensioners struggle to get their $80 out of their banks, and our best hospital goes for days without water that patients are now being asked to bring their own water,” he says.
Speaking out carries a heavy price.
“I’m definitely worried of re-arrest and I know they are trying to take me. I see danger and I fear for my life but I am more afraid of failing to explain to my children for having done nothing. Recently somebody called me and threatened to strangle me with the flag. Two government ministers have attacked me personally on social media. They are not used to citizens rising up and speaking to them.”
Jonathan Moyo, an opponent and minister in President Robert Mugabe’s cabinet, tweeted that US ambassador, Harry K. Thomas Jr, launched #ThisFlag at his residency. Mawarire and the US embassy deny this.
“The gap between real politics and cyber politics in Zimbabwe is so huge that one does not influence the other. Local politics remains the paradigm,” tweeted Moyo.
After Mawarire shut down the country Moyo had more to say.
“The notion that anyone can build Zimbabwe by shutting it down is an oxymoron,” Moyo tweeted.
“Moyo is trying to discredit the campaign by likening it to the Arab Spring. In all of my posts I made a call against violence; I know our government is well equipped to dealing with such kinds of resistance. They have accused us of being funded by the Americans, which is laughable and an indication of desperation,” says Mawarire.
#ThisFlag has shades of Baba Jukwa, the anonymous social media dissident that gave Mugabe and Zanu-PF headaches, so much so that a $300,000-reward was put on his or her head.
“I am not hiding like Baba Jukwa, I am not outside the country, people know where I live, and they know my salary.”
Editor of the Zimbabwe Independent and Chief Content Officer of Alpha Media Holdings, Dumisani Muleya, says Mawarire has rattled Mugabe’s government.
“It’s a defiance or anti-Mugabe regime campaign to rally people to fight the damaging leadership and policy failures of this government which have reduced Zimbabwe to ruins, hence panic by Zanu-PF ideologues to launch a counter. The regime is very afraid, anything can spark off an Arab Spring-like spontaneous uprising due to the explosive conditions on the ground,” says Muleya.
Bruce Mutsvairo, a social media researcher based at Northumbria University in Newcastle, England, says Africa has seen many campaigns of this nature.
“The problem is, in spite of their good intentions, most of these campaigns fall victim to clicktivism, that is to say, many people think by clicking a page, signing an online petition or producing a video on YouTube, they will achieve political change. Mawarire is encouraging a new generation of activists and citizens to speak up and that’s a good thing. But then you need someone to listen, otherwise it’s like fighting a losing battle.”
Mawarire’s campaign has seen him engaging officials, such as reserve bank governor, John Mangudya, in a bid to stop the introduction of bond notes, the first step to giving Zimbabwe back its currency. Mutsvairo believes more of that is needed if the clergyman’s campaign is to be successful.
“The real challenge is to transform remarkable online initiatives such his into offline political engagements,” he says. “No one had expected the reserve bank governor to listen to Mawarire and crew so that was quite an achievement but will he listen to Mawarire at all? Also, is anyone in Zanu-PF willing to engage Mawarire? Zanu-PF officials know the majority of people commenting online do not vote. They focus on the rural folk, most of whom have no idea who Mawarire is.”
That won’t stop Mawarire who wants to continue saying it loud and proud even if he risks going back to Bagdhad.

Say It Loud, Proud And At the Risk Of Ending Up In Baghdad

The drive to Zimbabwe’s capital, Harare, is slippery in light winter rain. The sky is full of rich grey clouds; on the ground, the country is paved with cracked roads, poverty and struggle.
On the way, many businesses are boarded up, their paint peeling and doors closed. As we arrive in Harare, many shops are packed with imported goods, but, in Workington, an industrial suburb in the south west of Harare, there is a stubborn survivor – a factory that has been producing Zimbabwean products since 1978.
Rank, founded by Amish and Ketan Naik’s grandfather, is the leading stationery supplier in Zimbabwe. It also distributes paper and board to the printing industry and manufactures plastic goods. Their grandfather arrived in Zimbabwe, via Zambia, from India in the late 1960s.
Business in Zimbabwe thrived until the country hit hyperinflation in the early 2000s. Although the factory is stacked with goods and 102 employees, like many businesses here, the lack of money in the banks threatens its survival.
<img loading="lazy" decoding="async" class="alignleft size-medium wp-image-5098" src="/wp-content/uploads/2017/05/DSC9345-300x200.jpg" alt="" width="300" height="200" />
The company has ample money in the bank but it can’t take it out to buy raw materials.
“We are being optimistic because if we are being pessimistic about this whole thing it won’t end well. We have been breaking even for the last six months, last year we were 3.5 percent down. We believe this year we are going to be 20 percent down or probably more,” says Ketan.
The company will cut the number of goods they produce to survive. They say they will try managing their overheads, because their staff is the last cost they want to cut.
“We will work within our means; effectively we will produce what we can in terms of what we can purchase in terms of raw material. It also means we have narrowed our gains down, guided by our industry,” he says.
It’s been a struggle over the last decade to keep the doors open.
“We had to scale down to the minimum. We were down to almost 10 percent, or less than 10 percent, because we were trading simply to pay wages. In the past, during high inflation, it came down to where our staff would just come in to have a meal because by the time they got their money, and went home, it was worthless,” says Amish.
The Naik brothers say their biggest threat is the weak economy. In a way, the recent ban on basic goods imports, which everyone is complaining about, may help companies like them.
“We estimated, for example, that in the exercise book industry, 40 percent was being imported from South Africa and 60 percent bought here. The tariff protection came in August 2015 and there has been a shift, we can say nine to ten percent or so increase, on our manufacturing, and the statistical growth shows it boosted our production,” says Amish.
Another Zimbabwean entrepreneur, Frank Buyanga, with a finger on the pulse, featured in FORBES AFRICA in 2013 when he had an Interpol notice imposed on him by government. He is back in business in Zimbabwe and thinks that the ban on imports is sensible as it protects home-grown industry.
“The advantages of doing business in Zimbabwe are the highly educated and generally honest workforce, good infrastructure and sophisticated business climate, especially when compared to other countries in Africa, except Botswana, Namibia and South Africa. The main disadvantage is the increasing level of corruption,” says Buyanga.
Ketan agrees the ban could work; but not with a weak economy.
“It doesn’t help as much because where there is a shortage created by us not having raw materials, the smugglers start because they now see an opportunity. If there is a shortage in the market of the product, the pricing would mean 50 percent mark-up”.
Even Rank’s suppliers are not happy.
<img loading="lazy" decoding="async" class="alignleft size-medium wp-image-5104" src="/wp-content/uploads/2017/05/DSC9723-300x200.jpg" alt="" width="300" height="200" />
“Our suppliers are saying to us that, ‘Guys we have supplied the goods you need to pay for those’. We have sort of done a reverse circle where initially we had to pay upfront; we built our relationships so that they provide us with credit facilities. Now we are ok, the credit facilities need to be reduced to zero and start paying upfront because we are not able to sustain them,” says Ketan.
Making a bit of money through exports into neighboring countries is not an option because it is expensive to manufacture products in Zimbabwe.
“A Malawian manufacturer, for example, would buy raw materials from the same places as us. But, we would pay let’s say $300 for a job yet they would pay less than $100 for that same job. How do we compete? Their expenses become lower, therefore their goods are cheaper.”
Rank is not the only Zimbabwean company running a tight ship.
On the other side of Harare, Melissa Mafunga, Managing Director at Hamilton Finance, says 30 to 50 people walk into their offices each day seeking to borrow money, most of these, struggling small business owners.
“Sometimes they come borrow money because they want to buy stock or pay a little bit of salaries. From here, I see that many small businesses are run on credit. Due to the cash challenges the country is facing, the default rate has risen by 75 percent this year. So we make sure we hold collateral before we lend out money,” she says.
<img loading="lazy" decoding="async" class="alignleft size-medium wp-image-5100" src="/wp-content/uploads/2017/05/DSC9405-300x200.jpg" alt="" width="300" height="200" />
Joyce Nousenga, General Manager at Hamilton Insurance, says business is slow because insurance is at the bottom of the list for companies.
“Even companies are slowing down on their purchase of insurance and most people opt for minimal cover, of which most of it is statutory. Business is tough for everyone, so much that they can’t even protect the little they have through comprehensive insurance,” she says.
We leave Amish and Ketan with hope that they will carry on breaking even in a country that is struggling to do so.

The Breakeven Blues

It’s a 542-kilometer drive from Johannesburg to Beitbridge. As we arrive the sun is shining its warm golden light over the bridge connecting South Africa and Zimbabwe. There are no birds chirping over the Limpopo River. It seems like a peaceful morning, until you get closer.
There is pandemonium as hundreds of cars line up to be stripped and searched before proceeding into Zimbabwe. A journey to Harare is delayed by at least three hours. President Robert Mugabe’s government has banned the importation of basic goods from South Africa. All banned goods are confiscated.
<img loading="lazy" decoding="async" class="alignleft size-medium wp-image-5106" src="/wp-content/uploads/2017/05/DSC9282-300x200.jpg" alt="" width="300" height="200" />
Priscilla Ngwenya is a woman in the autumn of her life. She has brown wrinkly skin, dull brown eyes and a jutting jawline that makes her look tired of suffering. On this day, she says she has endured pain and penury working for her grandchildren at home in Zimbabwe. She is not about to let anyone else gain from her sweat, nor her liters of cooking oil that she is trying to import.
“I will not work for the police. I work too hard for you to take food I bought for my family for yourselves. If I can’t get this to my hungry grandchildren, then no one else will have it,” she says as she pours 20 liters of cooking oil onto the street that she carried 2,000 kilometers from her job as a domestic worker in Cape Town.
Zimbabwe’s Ministry of Industry and Commerce banned basic imports of goods, such as cooking oil, coffee creamers, hair extensions, body creams, building material, furniture, baked beans, cereals, peanut butter, jams and mayonnaise. It is all part of a “Buy Zimbabwe” campaign that government hopes will see factories built in its land.
With millions worth of goods going into Zimbabwe, South Africa is the largest importer to the country and the biggest trading partner.
“[The ban] is a desperate move by Zimbabwe, to try and preserve their currency and to stimulate internal trade, however [it is] not viable as no local company can provide the basic consumer goods that South Africa offers,” says Ian Cruickshanks, Chief Economist at the Institute of Race Relations.
“This government is very stupid. We buy from South Africa because it is cheaper and it’s the only way for us to survive. Buying anything made in Zimbabwe is very expensive. The rands I earn can’t support my family,” Ngwenya screams throwing the empty bucket on the ground at Beitbridge.
The ban on imports has irked many like Ngwenya. Next to her is a man breaking the plastic electrical conduits he isn’t allowed to take across the border.
Just days before, traders burned a warehouse, where the confiscated goods were held, and barricaded the roads with rocks and burning tyres, forcing the closure of the border, believed to be the first time in history.
“I buy goods in South Africa and sell them here in a small shop in Bulawayo. That’s the way I have been surviving and keeping my family afloat. I used to be a teacher but I couldn’t deal with the lack of payments by government and I decided to get into business,” says Prudence Dube.
Tuleka Ngci, of GoAfrica, who has been transporting goods from South Africa to Malawi since December, says business has been slow after traders blocked the Beitbridge border. Ngci transports goods such as groceries, fruit and vegetables from South Africa through the Zimbabwean border to Malawi every week.
“If we can’t pass through the border to buy goods then that means there’s no business for us. Customers blame us for what is happening in Zimbabwe and as a result we find ourselves in the middle of a crossfire we don’t even understand,” says Ngci.
“The restriction against imported goods is threatening the livelihood of people and when people are hungry they get angry. And in this case who knows who they’ll take out their anger on.”
According to Dube, many Zimbabweans turn to smuggling.
“My business is registered, I pay duty for the goods I buy, and I employ six people. If this ban is not lifted, I will have to go the smuggling route like most informal traders in the country. That will be a disadvantage to government. I don’t think they thought this through and looked at how we would be affected,” she says.
Smuggling goods in open sight seems easy enough to do. At the border, some authorities are not shy to take bribes. We carried a two-liter cooking oil bottle to test the system. The man doing the checks told us cooking oil could no longer be imported into the country before asking for a bribe to let us through.
<img loading="lazy" decoding="async" class="alignleft size-medium wp-image-5107" src="/wp-content/uploads/2017/05/DSC9308-300x200.jpg" alt="" width="300" height="200" />
“I have a lot of friends who never pay anything. The officials are also hungry so they just pocket whatever they can get from people,” says Dube.
Most small businesses smuggle goods with the help of transporters like Bongani Sibanda.
“Because of the economic situation in Zimbabwe, smuggling is an everyday thing and we see ourselves as business people providing a service. I carry groceries, and whatever else people send from South Africa to Zimbabwe, twice a week. As long as it is not drugs or any illegal goods I see myself as helping people,” he says.
Sibanda says the ban will affect his “business”. More bribes mean higher fees.
“It will also bring in more business to us because those who cross the border to stock up themselves may be afraid to smuggle things so they will commission us,” he says.
Sibanda worked at a shoe factory in Bulawayo for 15 years before being thrown out by the factory closure. He now makes around $2,500 a month, enough to send his daughter to university in South Africa.
Sibanda may be making a buck, but the Zimbabwean economy isn’t.
According to media, the Chief Executive Officer of the Zimbabwe National Chamber of Commerce, Christopher Mugaga, estimates Zimbabwe could be losing $1.5 billion every year through smuggling of goods. The figure is more than one third of the country’s $4 billion national budget. Local industries have closed shop as their products fail to compete with the cheap smuggled products, cutting 100,000 jobs over the last five years. The government is said to make $60 million per month from duties charged at Beitbridge.
At the Beitbridge border post, Zimbabwe Revenue Authority (ZIMRA) Acting Commissioner General, Happias Kuzvinzwa, in a statement, has urged members of staff to desist from corruption.
“It is time to wipe away corruption! We must all know that we are accountable to the nation and seriously consider our duty as custodians of revenue laws in this country,” he says.
He says ZIMRA will intensify lifestyle audits to decrease numbers of goods smuggled into the country.
As we drive off, it seems trouble and smuggling at the border will not go away anytime soon.

The Border On A Slow Road To Nowhere

Aliko Dangote is a man revered for his remarkable achievements in business and his passion for his country. As I wait patiently in his office at Union Marble House, in the plush Lagos suburb of Ikoyi, an inscribed plaque catches my eye. Before I can read it, I hear a man’s voice.
“Nothing is impossible. That is my mantra in life. No matter what you go through, just remember, nothing is impossible for you to achieve and you will overcome it.”
Dangote, Africa’s richest man and the founder of Dangote Group, is dressed in a blue suit and purple tie. His demeanor is warm and welcoming, his gaze attentive. It is hard to believe this soft-spoken man is worth an estimated $14.4 billion, according to FORBES. Despite this wealth, the plaque in his office serves as a reminder of a day he almost lost everything. It all began with a wrong soil test.
“We were importing cement and we had an import terminal in Lagos and Port Harcourt. The government gave incentives to people who will make Nigeria self-sufficient in cement and so we decided to take advantage of the opportunity and build a cement plant. At the time, the entire production of Nigeria was less than two million tons but we decided that we were going to go ahead and build a [plant with] five million tons capacity,” says Dangote.
<div id="attachment_5094" style="width: 310px" class="wp-caption alignleft"><img loading="lazy" decoding="async" aria-describedby="caption-attachment-5094" class="size-medium wp-image-5094" src="/wp-content/uploads/2017/05/aliko-dangote-300x200.jpg" alt="" width="300" height="200" />Founder and Chief Executive of the Dangote Group Aliko Dangote gestures during an interview with Reuters in his office in Lagos, June 13, 2012. Picture taken June 13, 2012 REUTERS/Akintunde Akinleye (NIGERIA &#8211; Tags: BUSINESS) &#8211; RTR37GOU</div>
“So we brought in a contractor and we asked them to do the soil test and also the foundation test. Then they gave us the wrong soil test. Normally the northern part of Nigeria has very hard ground. But they came back and said we just needed a shallow foundation with a maximum of two meters. So the drawing and everything was done based on a two-meter foundation. As soon as we were three months into the job we realized it was more than this.”
This marked the beginning of a long battle to salvage the multi-million-dollar project. The group had hedged everything on the cement factory. In order to stay ahead of the competition, Dangote decided not to do a proper feasibility study so as to avoid attention to the new project. That decision came at a high cost.
“So now we had to go and do piling. We had to stop and change all the drawings and all of a sudden we were faced with 1,000 piles to be built and there were not enough rigs in Nigeria. So we had to order new rigs and even buy rigs for some of the contractors,” says Dangote.
To make matters worse, Dangote needed to finance the project.
“We needed to raise $480 million but the problem was 90 percent of the banks at the time had a market capital of only $20 million. In addition, there were no long-term loans, only short-term loans for about 90 days, so you could tell the challenge we faced. The project stopped, we had to change the drawings and we could not borrow too much money in the system. Borrowing short term and investing in a long-term business was so difficult.”
Another problem was infrastructure.
“We realized that we had to build a gas pipeline because the government who promised to build the pipeline in 1978 had actually not done anything, so we had to construct 92 kilometers of a gas pipeline. The water table was very bad in the area so we had to build a dam and over 100 houses because there was nothing there, so the challenges were coming one by one.”
For Dangote, failure was not an option.
“In my office, I had the project drawings on my wall but I knew that once this project fails the group is gone and that is what really kept me going. It was a major project for us because our size, compared to a project of half a billion then, was big money for us.”
Eventually, there was light at the end of the tunnel. The group received a much-needed lifeline in the form of a $479-million loan from a consortium of banks, led by the International Finance Corporation (IFC). But the storm hadn’t abated yet.
“The most challenging was when we had the cost overrun. Now we had finished the cement factory and the factory was not working and that was really when I went from black to red. I knew that we were really in trouble. But we were very adamant and we persevered. We had challenges for over a year or so and the factory was working on and off,” he says.
That was in 2003. Since then, the Dangote Group has expanded into 18 countries in sub-Saharan Africa as well as Nepal. This year, Dangote plans to take on a new challenge, the volatile oil market.
“We have been pushed into oil because we realized that we had too much cash for the type of business that we are running today, so we need to diversify. On the diversification strategy, we look at what the areas are that can actually take Nigerians to the next level and that is where we map out all the issues and the problems that we are facing as a country for lack of diversifying the economy.”
The group is building one of the largest oil refineries in the country with the potential to meet Nigeria’s requirement of 445,000 to 550,000 barrels of fuel, with spare capacity to export, according to Dangote. The project has an estimated completion date of 2018.
As we wrap up the interview, Dangote’s gaze goes back to the plaque on his table.
“It was a challenging experience and that is why I have the plaque on the table saying nothing is impossible. You need tenacity and focus in business. I have learned a lot and since that time I don’t really get scared of anything.”

Tag: August 2016

FORBES AFRICA SOCIAL MEDIA